Flora hall went to Rent A Center in Milwaukee and signed an agreement to make mo
ID: 2600954 • Letter: F
Question
Flora hall went to Rent A Center in Milwaukee and signed an agreement to make monthly payments of $77.96 for 19 months in exchange for Rent A Center allowing her to have a Rent A Center washer and dryer in her home. In addition, the agreement required Hall to pay tax and liability waiver fee on the washer and dryer. The total amount she would pay under the agreement was $1643.15. The agreement provided that Hall would return the washer and dryer at the end of the 19 months or she woat at that time pay $161.91 and own the washer and dryer as her own.
Is this a sales contract?
Is this a consumer lease?
At the time Hall leased her washer and dryer she could have purchased a set for $600. What do you think about the agreement? Is it unconscionable? Refer to Chapter 22 to see whether any other consumer laws apply. Must this contract be in writing?
Answer using IRAC: Issue, Rule, Analysis, and Conclusion
Explanation / Answer
This is a sales contract because Flora is not buying the goods for her sole possession. The washer and dryer still belong to Rent-A-Center, and she is simple paying a monthly fee for the right to use the washer and dryer that is owned by Rent-A-Center.
2. Yes , this is a consumer lease .As consumer lease is defined as a "As lease made by a merchant lessor regularly engaged in the business of leasing or selling the kinds of goods involved. A consumer lease is made to a natural person who takes possession of the goods primarily for personal, family, or household use.
In the given agreement that Flora signed she is taking possession of the washer and dryer for home personal use and is making monthly payments of $77.96 for 19 months for the right to take possession of the washer and dryer.
3. I think this particular cost agreement is a fraud or a theft i.e a rip off. It only costs $600 to own both the washer and dryer and in the long run Flora will be paying over $1,643.15 just for the use of the washer and dryer for the 19months and an additional $161.91if she chooses to own the washer and dryer at the end of the 19 months. This is over 3 times the worth of the washer and dryer if bought at $600. A lot of people can not afford to outright buy things but the interest that Rent-A-Center makes with this agreement is excessive.
4. I believe that this agreement is unconscionable.
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